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Texas Tomorrow Fund

One more thing the Lege failed to do

Anyone keeping a list?

Texas lawmakers adjourned without fixing the state’s prepaid college tuition program, which now faces a $600 million shortfall and could go broke as early as 2014 by some estimates.

If that happens, state taxpayers may have to cover the shortfall because the state constitution guarantees payment to those who bought in.

“This thing is going to smack everybody in the face,” said Keith Oakley, a former state representative who supported the fund’s creation and bought contracts for his children. “I just don’t know when.”

The issue didn’t get traction in the legislative session because the state’s budget shortfall loomed large over many issues and programs.

“Everything was put on hold because of the financial crisis the state was facing,” said Oakley, who serves as legislative director for the Tomorrow Fund Families, which is working to help families who rely on the contracts.

[…]

The comptroller’s office didn’t have the data available this week to determine how recent market improvement has lessened the shortfall, but at one point it was projected at more than $1 billion.

[Comptroller spokesperson RJ] DeSilva said the plan’s current unfunded liability should be available in the 2011 annual report after August.

The fund now has about $1.4 billion in assets, he said.

Because the program is constitutionally backed, the state would eventually have to devise a way to cover the shortfall, he said. “It’s a legislative decision in terms of addressing it,” he said.

But don’t worry, I’m sure the next Lege will clean up this mess, too. Hopefully they’ll have fewer “emergencies” to distract them from the task.

Interview with Rep. Scott Hochberg

Rep. Scott Hochberg

State Rep. Scott Hochberg, who represents HD137, is generally considered the Legislature’s leading expert on public education and school finance. He’s the Vice Chair of the House Public Education Committee, and he chairs the Appropriations Subcommittee on Education. With so many facets of public education in Texas being in the news lately, I thought I’d take advantage of this opportunity to ask him a bunch of questions about it:

Download the MP3 file

Normally, my interviews cover a broader range of topics, but in this case I feel like we could have spoken twice as long as we did and still not covered everything. Rep. Hochberg mentioned a couple of items in our conversation that I want to include here. First, he discussed the actual statute that directed the Texas Education Agency to create a growth metric for the schools. That’s Sec. 39.034 of the Education Code, entitled “MEASURE OF ANNUAL IMPROVEMENT IN STUDENT ACHIEVEMENT”, which I reprint beneath the fold. I think if you read it you’ll agree that the intent is pretty clear, and that the TEA is not following that intent. Second is this presentation to the Appropriations Subcommittee on Education by the Comptroller about the Texas Tomorrow Fund. See page 6 for the chart in question, which shows how the Texas Guaranteed Tuition Plan (TGTP) is going to be drained by 2018 as a result of tuition deregulation. Let me know if you have any questions about either of these.

As always, you can find a list of all interviews for this cycle on the 2010 Elections page.

UPDATE: The Quorum Report was kind enough to pick up on my interview and ask Rep. Hochberg a couple of questions of their own about it. See beneath the fold for the full story, which was sent to me by reporter Kimberly Reeves.

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